Microsoft has signed a historic agreement that will mark a before and after in the technology and energy industry. The company based in Redmond has closed the largest power purchase agreement in its history, which will allow the reopening of a nuclear power plant that has been closed since 2019 to power its artificial intelligence data centers.
An unprecedented agreement
Constellation Energy will be in charge of reopening the Three Mile Island nuclear power plant located in Pennsylvania. This plant, which has been closed since 2019, will provide 835 MW of clean electricity to the grid. Microsoft has committed to purchasing all of its production for the next 20 years to meet the energy needs of its AI data centers.
Renovation and modernization
Constellation Energy will invest $1.6 billion in the restoration and modernization of the plant. The goal is to reactivate it in 2028 to fulfill the Microsoft contract. As part of this process, the nuclear power plant will be renamed as the Crane Clean Energy Center, in honor of the late Chris Crane, former CEO of Exelon, Constellation’s former parent company.
Economic and labor impact
The reactivation of the plant will not only benefit Microsoft and Constellation Energy. It is expected that this project will generate 3,400 direct and indirect jobs, revitalizing the economy of Pennsylvania. Estimates indicate that the reopening of the plant will contribute $16 billion to the state’s GDP.
The energy demand of AI
This agreement highlights the exponential growth of energy demand from data centers, driven by the rise of artificial intelligence. The training and execution of generative AI models consume significantly more energy than traditional algorithms, leading Microsoft to take unprecedented measures to ensure a stable and carbon-free power supply.
Why a nuclear power plant?
The decision to reopen a nuclear power plant responds to two critical needs of Microsoft: an abundant and constant energy supply. Unlike renewable energy sources like solar or wind, which are subject to fluctuations, nuclear power plants can provide carbon-free energy 24 hours a day, 7 days a week.
This strategic move will allow Microsoft to rapidly advance towards its goal of powering all of its infrastructure with 100% carbon-free energy, while addressing the energy challenges posed by the rapid development of artificial intelligence.